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Market Insight

Polysilicon utilization rates remain high in H2 2016 but prices start to decline

June 30, 2016  | Subscribers Only

Jessica Jin Jessica Jin Senior Analyst, Solar Supply Chain

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Polysilicon utilization rates remain high in H2 2016 but prices start to decline

Jessica Jin and Edurne Zoco

A polysilicon supply shortage in the first half of 2016 has resulted in a strong increase of the industry-level utilization rate and spot price. However, entering into June, with a flattening downstream demand and increasing polysilicon capacity coming online, price is forecasted to decline again by single-digit percentage.

Key Facts
• Significant increase of polysilicon ASP in Q2 has resulted in a decline of wafer gross margin and module gross margin throughout the quarter.
• Polysilicon ASP has finally started to decline in June as a consequence of additional capacity being fully ramped-up in H2 2016.
• Strong polysilicon demand combined with depleted inventories and limited addition of new capacity will translate in high average utilization rates for polysilicon players in 2016.
• Demand for polysilicon will increase marginally year over year during the 2016-2020 period, mainly due to technology improvements on the wafer side.

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